Industry welcomes denotification of fruits and vegetables from APMC proposed in Budget 2017

PUNE: Though the Union Budget made a passing reference that the state governments will be urged to denotify perishables from APMCs, the food processing industry thinks there is dire urgency of reforming the agricultural marketing sector.

"Market reforms will be undertaken and the States would be urged to denotify perishables from APMC. This will give opportunity to farmers to sell their produce and get better prices," said finance minister Arun Jaitely, in his budget speech.

"We also propose to integrate farmers who grow fruits and vegetables with agro processing units for better price realisation and reduction of post-harvest losses. A model law on contract farming would therefore be prepared and circulated among the States for adoption," stated the budget document.

However, the food industry pointed out that contract farming act does not exist in many states. Even in those states that allow direct marketing of their produce by farmers, the APMCs insist on paying the market charges and harass farmers, complained the industry veterans.

Sunil Deshmpande, head, Jain Farm Fresh Foods, one of the biggest processors of mangoes, other fruits and onions in the country, said, "If fruits and vegetables are removed from the APMC regulations, farmers and processors will benefit immensely. Companies will be able to pass on the innovative technologies, good agricultural practises and supply agricultural material to the farmers."

Enforcement of the obligations under contract farming is an issue in the states, where contract farming is already in place. However, the processing industry thinks that it is obvious in the country like India where majority of the farmers have small holdings.

Agricultural marketing is a state subject and the central government had first circulated the model APMC Act in 2003 for the states to adopt it. Yet, close to 50% of the states have not made necessary changes to their respective state agricultural marketing acts.